November 15, 2012

GOP-led states soften on health law

Some are more open to the changes and to setting up exchanges, and others are awaiting more details.

The Associated Press

WASHINGTON – From the South to the heartland, cracks are appearing in the once-solid wall of Republican resistance to President Obama's health care law.

Ahead of a federal deadline Friday for states to declare their intentions, Associated Press reporters interviewed governors and state officials around the country, finding surprising openness to the changes in some cases. Opposition persists in others, and there is a widespread, urgent desire for answers on key unresolved details.

Thursday evening, the Obama administration granted states a month's extension, until Dec. 14. A check by the AP found that 16 states remain undecided.

The law that Republicans have derided as "Obamacare" was devised in Washington, but it's in the states that Americans will find out if it works, delivering promised coverage to more than 30 million uninsured people.

States have a major role to play in two of the overhaul's main components: new online insurance markets for individuals and small businesses to shop for subsidized private coverage, and an expanded Medicaid program for low-income people.

States must declare if they'll build the new insurance markets, called exchanges, or let Washington do it for them. States can also opt for a partnership with the federal government to run their exchanges, and they have until February to decide on that option.

Some glimpses of grudging acceptance across a shifting scene:

One of the most visible opponents of Obama's overhaul, Florida Republican Gov. Rick Scott, now says, "If I can get to 'yes,' I want to get to 'yes.'"

Florida was a leader in the failed effort to overturn the law in the Supreme Court, and a group formed by Scott ran TV ads opposing it before it passed Congress. But the governor told the AP this week he wants to negotiate with the federal government to try to help the nearly 4 million uninsured people in his state.

In Iowa, GOP Gov. Terry Branstad says he is postponing a decision because Washington has not provided enough information about key details. But his spokesman, Tim Albrecht, said Iowa is exploring a partnership exchange that could include several states. Albrecht said they're confident they can get to a state option if needed.

Ohio, a state Obama carried in the election, is leaning toward a partnership with the federal government despite GOP officials' continued misgivings about the law.

In Mississippi, Republican insurance commissioner Mike Chaney formally notified Washington on Wednesday that his agency will proceed with a state-run exchange, disappointing GOP Gov. Phil Bryant, who remains staunchly opposed to Obama's law.

Chaney, too, says he wishes the law could be repealed, but he worries that "if you default to the federal government, you forever give the keys to the state's health insurance market to the federal government."

Policy experts in Washington are noticing the shift.

"I think it's a very practical decision for states now," said Alan Weil, executive director of the nonpartisan National Academy for State Health Policy. "We are going to have a significant number of states running their own exchanges, a significant number where the federal government is running the exchange, and a significant number of partnerships. The bottom line is we are going to have to figure out how to make all three models work."

Although the public remains divided about the health care law, the idea of states running the new insurance markets is popular, especially with Republicans and political independents. A recent AP poll found that 63 percent of Americans would prefer states to run the exchanges, with 32 percent favoring federal control.

There are several potential benefits to a state operating its own exchange, experts say.

The biggest advantage may be that states would be more closely involved in coordinating between the exchanges and Medicaid programs. Because many people are going to be going back and forth between Medicaid and private coverage in the exchanges, states would probably be better served by a hands-on role.

States can also decide whether to allow open access to all insurers, or work only with a panel of pre-screened companies that meet certain requirements.

Also, the exchanges will offer coverage to people buying in the individual and small-business markets, areas that states have traditionally regulated. Without a state-run exchange, states could be dealing their own regulators out of the equation, as Mississippi's insurance commissioner Chaney noted.

Despite signs of movement toward going along with implementation of the overhaul, some major Republican-led states are holding fast. In Texas, the election results did not change any of the opposition to expanding Medicaid or to setting up insurance exchanges. The same holds for Louisiana, South Carolina, Missouri, Kansas and others.

"Adding more people to an already sinking ship with money that is either being borrowed from China or coming out of taxpayers' pockets is bad policy and bad for Texans," said Catherine Frazier, spokeswoman for Gov. Rick Perry. Twenty-seven percent of that state's residents are uninsured, the largest percentage for any state.

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